At two in the morning, my phone kept ringing. A friend from Jiangxi kept sending voice messages, sounding flustered:
"Sister Lin, I opened a long position with 10 times leverage on my entire 10,000 U, and after a 3% pullback, my money is gone. What happened?"
I opened his trading record and saw that he had fully invested 9,500 U without even setting a stop loss.
Many people mistakenly believe that "full position = can withstand it"; in fact, the opposite is true—using a full position poorly can lead to faster losses than using a partial position.
1. The key to full position liquidation: it's not leverage, it's position size
Taking a 1,000 U account as an example:
With 900 U at 10 times leverage, a 5% opposite market fluctuation will lead to a total loss;
However, with 100 U at 10 times leverage, it requires a 50% fluctuation to be liquidated.
My friend put in 95% of his principal at 10 times leverage, and with just a slight pullback, it went to zero.
2. Three principles that allowed me to use a full position for six months without liquidation and still double my money
1. No single trade should exceed 20% of total funds
For a 10,000 U account, the maximum investment in one trade is 2,000 U.
Even if I misjudge the direction and set a stop loss at 10%, I would only lose 200 U, preserving my principal and allowing for a comeback at any time.
2. Single losses should never exceed 3% of total capital
For instance, with 2,000 U at 10 times leverage, setting a stop loss at 1.5% means a loss of 300 U, which is exactly 3% of total capital.
Even if you make several mistakes, it won't hurt too much.
3. Do not open positions during fluctuations, do not increase positions in profit
Only engage in trend breakout markets; even if sideways markets look enticing, stay on the sidelines;
After opening a position, never add more, eliminating emotional interference.
3. The real use of a full position: it is a buffer, not gambling
The original design of a full position is to leave room for error in fluctuations, but the premise must be light positions for trial and strict risk control.
Previously, a fan of mine kept facing liquidation every month, but after following these three rules, he increased his capital from 5,000 U to 8,000 U in three months.
He said: "I used to think a full position was gambling with my life, but now I understand that a full position is to live more steadily."
Survival in the cryptocurrency world is not about who earns faster, but about who lasts longer.
Bet less on direction, control positions more, and slow is fast.
Opportunities abound, but they wait for no one. To keep pace without getting lost, join Sister Lin in strategizing together!